Thank you, Mr. Vellacott. Those are great questions. We could spend a lot of time talking about those, and I know time is pressing, so I'll be as fast as I can through some of those.
Income splitting will not help those people who are in abject poverty at this time. They need other programs to help move them up, through education and other social programs, and so on. Income splitting will help people who are in low-income families and who are on the borderline of poverty, who are paying a high percentage of tax right now. And the tax burden they have limits their choices; it limits their family's choices and it limits how they can move ahead.
It's in the document, but just for one quick example, take two families here in Ontario living side by side, both with two parents, two children, and both families earning $70,000. One family has a single earner, the other family has two earners--that's $35,000 each. So the scenario is exactly the same. The family that has one earner will pay approximately $4,000 more per year in taxation than the family next door that has the same family income. There's an inequity there: $4,000 can go a long way in a family that is trying to just pay the grocery bills or if they're trying to look for extras for their children that will advance their education, expand their cultural and social norms, and things of that nature.
You asked a question about “demographic winter” as well as the issue around models. The demographic winter is a huge question, and countries such as Japan and Russia, quite honestly, right now have a decreasing population. We're on the borderline of that right now. We're not quite there yet. Other countries in Europe are on the cusp of dropping their population overall in the long term as well. What that means for baby boomers--I look around here and the bulk of us are in that age range, from the maximum to the minimum--is that as we age, our health care costs are going to be going up. With a smaller number of children, there are going to be fewer taxpayers. Therefore, when we all want to have our health care for hip replacements, or knee replacements, or something like that, there's going to be an increased burden tax-wise onto the younger generation.
An interesting thing is that in the last number of years, with Alberta having such an economic boom in the last five or ten years, its birth rate has actually been going up a little bit this last while. We're seeing that the security of economics is definitely tied in with birth rate. We're seeing that with some of the other young people we've been researching or seeing through other studies, that where they feel economically secure, they're more likely to start their families or to have two children as opposed to one child and things of that nature.
The model that I like the best perhaps, or some aspects of it, is actually the French model. The reason is that it not only has aspects for families, but it also deals with single-parent families as well. How they do that is for a single mom and two children, the first child is counted as an adult in the taxation structure. So they account for the financial needs that a single-parent family actually has, something that some of the other countries do not take into account at this particular time.